Medical Marjuana Prices To Increase In Canada Under New System

A worker inspects a marijuana plant at a grow house in Denver, on Thursday, Nov. 8, 2012. Marijuana legalization votes this week in Colorado and Washington state don't just set up an epic state-federal showdown on drug law for residents. The measures also opens the door for marijuana tourism. (AP Photo/Ed Andrieski)

OTTAWA - The cost of medical marijuana in Canada is set to hit a new high as the government seeks to get out of the business.

Regulations posted Friday by Health Canada propose medical marijuana should be treated more like any other medicine.

Essentially, the new system would create licensed grow-ops that people could shop at, provided they have a prescription from their doctor.

Currently, those who wish to use medical marijuana must apply for a permit from the government in order to either grow it themselves or buy it from a single government grower.

There has been demand for years for the system to change because of health and safety concerns and also issues surrounding access and quality.

But the changes will come at a cost for users.

"The main economic cost associated with the proposed (Marijuana for Medical Purposes Regulations) would arise from the loss to consumers who may have to pay a higher price for dried marijuana," the regulations say.

Currently, the price of medical marijuana in Canada ranges from $1.80 to $5.00 a gram.

It will rise to $8.80 under the new system, which would see consumers forfeit about $166 million a year for 10 years, the regulations say.

That's in part because the government will stop subsidizing the marijuana it sells.

Canadians have had access to marijuana for medical purposes since 1999 and the system has been tweaked several times since thanks mostly to court cases.

The posted regulations say the growth of the program has placed a strain on Health Canada's resources.

In 2002, 477 individuals were authorized to possess marijuana for medical purposes. As of August, that number had grown to 21,986.

The majority grow their own marijuana or buy from a supplier, not the government.

That's created concerns for Health Canada, which pegs the cost of running the program between 2010 and 2013 at $16.8 million, not including tax. An additional year would cost $9.7 million.

Law enforcement authorities have had their own worries.

"Police have also raised concerns that residential production activities leave the program vulnerable to abuse, including criminal involvement and diversion to the illicit market, particularly given the attractive street value of marijuana," the regulations say.

Meanwhile, 70 per cent of people in the program who grow their own marijuana produce 25 plants or more, and many production sites aren't properly set up to handle that, the regulations say.

The risk of mould, toxic exposure and electrical hazards is widespread.

In January, inspectors in Calgary examined an operation licensed by Health Canada and found several infractions, including building code violations and compromised air intake.

Toxins, pesticides, herbicides, fertilizer and potentially contaminated drinking water were also found.

"Such issues may not only have an impact on individual producers, but also potentially on those living at the same address, adjacent residential units, and/or in the surrounding community, who may not even suspect the existence of these risks," the regulations say.

For its role in the production and sale of marijuana, the government collected $1,686,600 in 2011-2012.

Health Canada would not regulate the price of marijuana under the new system, leaving it up to licensed producers who would have to agree to a set of conditions before being able to produce the drug.

"The new regulatory scheme returns Health Canada to its traditional role of regulator rather than producer and service provider, while striking a better balance between access and risks to public health and safety," the regulations say.

Health Minister Leona Aglukkaq announced last year that she intended to get the government out of the business of growing medical marijuana.

A series of consultations were held across the country on the new program before the regulations were unveiled.

The government is inviting public comment on the new system for the next 75 days.